Materialise Shows All-Around Strength in Second Quarter 2016 Financial Results

As the year progresses, the 3D printing community has been dismayed towards the lackluster financial results from industry giants like 3D Systems and Stratasys, both of which have struggled to show positive results (although Stratasys has recently showed steady improvement in this department). But, that doesn’t necessarily mean that the rest of the 3D printing industry is struggling alongside these two; at least, that’s certainly not the case with the Belgium-based software and 3D printing service provider Materialise.

Materialise seems to be covering all of the bases this year, from opening the 3D Printing Center of Excellence in Malaysia to creating props for the world’s largest electronic music festival, and their wide reach has proved worthwhile in their second quarter financial results. The first quarter of 2016 proved to be a viable one for the 3D printing company, showcasing a rising revenue despite experiencing a greater net loss than expected. This quarter, the numbers tell a familiar tale for Materialise, which has posted an 11.4% revenue (27,597 kEUR) increase compared to the 24,772 kEUR held during the second quarter of 2015. More importantly, this upward trend has occurred in all three of their business segments, Materialise Software, Materialise Medical, and Materialise Manufacturing, proving that their overall operations seem to be in pretty decent shape.

The Materialse Software segment, which is propped up by their all-encompassing Magics 3D Print Suite software, increased revenue by 14.9% to 6,981 kEUR for the second quarter of 2016 from 6,078 kEUR for the same quarter last year. Revenue from their Medical segment, which offers an intensive platform for medical planning and design software, clinical engineering services, and patient specific devices, increased by 16.7% to 9,706 kEUR, a sizable upswing compared to 8,315 kEUR for the same period in 2015. Finally, in their Manufacturing segment, Materialise had an increase of 5.1% to 10,907 kEUR for Q2, slightly rising from the 10,379 kEUR shown during the same period in 2015, primarily as a result of higher-end part manufacturing.

Executive Chairman Peter Leys

“During the quarter we launched several new initiatives to support our positioning as the ‘backbone’ of industrial 3D printing, including a collaboration with HP to develop a tailored software solution for its Multi Jet Fusion technology. We believe the entrance of this and other blue-chip companies into the additive manufacturing industry demonstrates the industry’s potential to transform manufacturing and supply chain dynamics, and we view our partnerships with these companies as validation of Materialise’s capabilities and industry positioning. We are developing additional meaningful partnerships and, although we expect certain parts of our industry to continue to show slow growth in the near term, our outlook for the year remains within our previous guidance range,” said Executive Chairman Peter Leys.

In addition, Materialise also showed a slight expansion in gross profit, going from 57.8% of total revenue last year to 58.9%, which increased due to their improvements in the Manufacturing segment. Research and development, sales and marketing, and general and administrative expenses had an overall increase by 8.1% to 19,182 kEUR for the second quarter of 2016, a jump from 17,738 kEUR for the second quarter of 2015. Their net other operating income, which consists of withheld tax exemptions for qualifying researchers, development grants, partial funding of R&D projects, and currency exchange, increased from 1,474 kEUR to 1,778 kEUR.

Materialise Magics 3D Print Suite

Obviously, with their revenue increasing across the board, Materialise looks to be in fair shape. In fact, their net loss for the 2016 second quarter was just 436 kEUR, a welcoming sign compared to the net loss of 3,013 kEUR that they posted during the same period in 2015. This 2,577 kEUR improvement stems from their increase in their operating profit, as well as improvements with financial results and income tax income. Materialise had cash and equivalents of 51,304 kEUR at the end of Q2, compared to 50,726 kEUR they held at December 31, 2015. Lastly, their cash flow from operating activities in the second quarter of 2016 was 4,405 kEUR, compared to 543 kEUR in the same period last year.

All in all, Materialise’s second quarter financial results show improvements across the board, as their three main business segments continue to expand their reach. To continue their growth into the long term, the 3D printing service provider plans to expand their production facilities in Poland, as well as their corporate facilities in Belgium. Materialise plans to invest approximately 17,000 kEUR in capital expenditures over the next 12 months, as they look to continue to grow into one of the most well-recognized and respected 3D printing companies in the industry. Discuss further in the Materialise Q2 2016 Results forum over at 3DPB.com.